Talking Points:
– GBP/USD to Eye 1.5900 Going Into BoE as Martin Weale, Ian McCafferty Remain the Minority.
– AUD/USD Bearish Momentum in Focus; Will RBA Continue to Implement Verbal Intervention?
– USDOLLAR Hits Near-Term Targets on Strong NFP; RSI Remains Capped.

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GBP/USD

GBP/USD vulnerable for a further decline going into the Bank of England (BoE) interest rate decision on October 9 as the Relative Strength Index (RSI) dips back into oversold territory.
BoE may refrain from releasing a policy statement once again as Martin Weale & Ian McCafferty stand as the minority.
Despite the flip earlier this week, the DailyFX Speculative Sentiment Index (SSI) now shows net-long positioning in GBP/USD as the ratio stands at +1.83.

AUD/USD

AUD/USD retains bearish outlook ahead of the Reserve Bank of Australia (RBA) policy meeting on October 7, with RSI push back below 30.
Despite expectations of seeing the RBA preserve its current policy, toughen verbal intervention from Governor Glenn Stevens may generate another set of lower-lows in the exchange rate.
Next downside targets come in around 0.8525 (50.0% expansion) to 0.8550 (38.2% expansion).

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USDOLLAR(Ticker: USDollar):

Index

Last

High

Low

Daily Change (%)

Daily Range (% of ATR)

DJ-FXCM Dollar Index

11132.42

11142.81

11016.09

1.04

228.59%

Chart – Created Using FXCM Marketscope 2.0
The Dow Jones-FXCM U.S. Dollar Index hits near-term target around 11,120 (1.618% expansion) to 11,138 (61.8% expansion) as U.S. Non-Farm Payrolls (NFP) climbs 248K in September.
Despite the series of higher highs, need to see a push higher in the RSI to favor further USDOLLAR strength as the oscillator remains capped around the 83.00 region.
With a slew of Fed officials speaking next week, will watch their take on inflation amid subdued wage growth.
Still need to see a bearish RSI break to favor a near-term correction; former resistance zone around 10, 752 (38.2% expansion) to 10,759 (61.8% retracement) remains in focus.

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— Written by David Song, Currency Analyst

To contact David, e-mail dsong@dailyfx.com. Follow me on Twitter at @DavidJSong.

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Source: Daily fx